Why you should go solar before NEM 3.0 arrives

In January, California net energy metering rules are changing for the worse.

Rooftop solar customers will likely a lower savings opportunity after California adopts the third generation of the State’s net energy metering guidelines.

What is NEM?

Under net energy metering (NEM), California investor-owned utilities are required to pay customers that export solar energy to the grid. If your onsite solar system generates more electricity than you need, you can send your extra electricity to the grid and receive a bill credit that reduces the cost of the electricity that you consume from the grid. NEM was first implemented in California in 1996 and it was updated to NEM 2.0 in 2016.

How is NEM changing in California?

In January 2022, the California Public Utilities Commission (CPUC) will release NEM 3.0, the third iteration of net energy metering for the State.

The details have not yet been finalized, but it is almost certain that NEM 3.0 will add more fixed charges and reduce net metering payments, which greatly reduces the value of owning solar. Some have proposed to reduce the value of NEM credits by up to 80%!

Why should I go solar now?

In the January 2022 decision, the CPUC will also establish a cut-off date for new solar owners to qualify for NEM 2.0, likely within a year from January. Regardless of the exact date, it is clear that time is limited to qualify for NEM 2.0 before NEM 3.0 takes effect. Solar owners who are enrolled in NEM 2.0 will likely be grandfathered into NEM 2.0 and its benefits for the first 20 years of project operation.

By installing solar now, you will benefit from NEM 2.0’s higher value of net metering credits, which translates to lower electricity costs for you.

At Promise Energy, we don’t believe that one size fits all. We pride ourselves in designing and installing customized energy solutions that provide the greatest long-term value and energy control for our customers.